Vietnam Airlines Needs US$1.79Bln for Development by 2010

Vietnam Airlines, the national flag carrier, has announced that it will need VND28.252 trillion (US$1.788 billion) for its development plan by 2010, including more than VND18 trillion (US$1.14 billion) for its flight fleet.

 

Earlier this month, Reuter quoted its Board chairman Nguyen Sy Hung as saying that the figures will be VND25.3 trillion (US$1.6 billion) and VND19 trillion (US$1.2 billion), respectively.

 

The move is aimed to fulfill its target of becoming the fourth biggest air market in Southeast Asia in 2015-2025.

 

According to the airlines’ latest announcement, the money will be spent to achieve an on-year growth of over 10 per cent and transport 12 million passengers and 205,000 ton of goods from now to 2010.

 

Under the development plan, the State-owned carrier will target short-distant planes for domestic routes, medium-distances (3h-5h) aircraft for international routes and high-level ones as well as specialized planes for goods transporting.

 

Accordingly, Vietnam Airlines will raise its fleet from its current 39 aircraft to 56, including 32 privately owned by the airline.

 

Besides, it will also eye high-level airplanes for trans-continental routes by 2020 and aims to have 100 aircraft by then in order to meet the local annual demand rise of 13-14 per cent over the next five years. 

 

Last June, Vietnam Airlines signed a deal to buy four Boeing Co. 787 "Dreamliner" aircraft worth around US$500 million at list prices, for delivery in 2009 and 2010. The Vietnamese national flag carrier now has 10 B-777s, one B-767 and two B-737s in its fleet of 41. In which, it has already leased six 777s.

 

The carrier now flies to 16 domestic and 27 international destinations. In 2006-2007, it will look into opening a direct flight to North America.

 

The airline had planned to launch a direct flight to the United States -- home to an estimated 1.5 million people of Vietnamese origin -- in the middle of 2006. But for a number of reasons, including a shortage of aircraft, the plan is delayed until 2007.

 

Vietnam Airlines projected revenues are expected to grow more than 10 per cent annually from now until 2010, when they should reach US$2 billion. It also reported average revenue growth of 20.5 per cent a year during the 2001-2005 period. Last year, its revenues hit nearly US$1.3 billion, even though the country suffered a bird flu outbreak and higher fuel costs.